GCL Poly Energy : Announcements and Notices - Discloseable Transaction - Cooperation Agreements in Relation to Proposed Establishment of the Fund

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness, and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

GCL-POLY ENERGY HOLDINGS LIMITED

保 利 協 鑫 能 源 控 股 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 3800)

DISCLOSEABLE TRANSACTION

COOPERATION AGREEMENTS IN RELATION TO PROPOSED

ESTABLISHMENT OF THE FUND

The Board refers to the Company's announcement dated 17 April 2019 regarding

the establishment of a proposed investment fund with Leshan Municipal People's Government (樂山市人民政府) and Shanghai Zhongping Guohao Assets Management Co., Ltd.* (上海中平國瑀資產管理有限公司) ("Zhongping Guohao").

On 31 May 2019, Jiangsu Zhongneng Polysilicon Technology Development Co., Ltd.* (江蘇中能硅業科技發展有限公司) (an indirect subsidiary of the Company) ("Jiangsu Zhongneng") entered into the Cooperation Agreements in relation to the establishment

of Leshan Polysilicon Photovoltaic Information Industry Investment Fund* (樂山多晶 硅光電信息產業基金) (the "Fund"). The other parties to the Cooperation Agreements are: (a) Leshan Gaoxin Investment Development (Group) Limited* (樂山高新投資發展 （集團）有限公司) ("Leshan"), (b) Suzhou Zeye Investment Co., Ltd. (蘇州澤業投資有 限公司) ("Zeye Investment"), (c) Zeye New Energy Holdings Limited* (澤業新能源控股 有限公司) ("Zeye Holding") and (d) Zhongping Guohao.

The Fund will primarily invest in the polysilicon materials industry in Leshan City of Sichuan Province, PRC and companies with mature growth prospects in the photovoltaic industry.

- 1 -

Under the Cooperation Agreements, the total capital commitment for the Fund is intended to be between RMB4 billion and RMB4.5 billion, of which:

1. Leshan intends to contribute RMB1.5 billion;
2. Jiangsu Zhongneng intends to contribute RMB500 million;
3. Zeye Investment intends to contribute RMB500 million to RMB1 billion; and
4. a nominee of Zhongping Guohao intends to contribute RMB1.5 billion (of which RMB1 billion will be contributed by Jiangsu Zhongneng).

LISTING RULES IMPLICATIONS

As the highest of the applicable percentage ratios in respect of the Company's aggregate intended investment in the Fund is more than 5% but less than 25%, the entering into of the Cooperation Agreements constitutes a discloseable transaction of the Company under Chapter 14 of the Listing Rules and is therefore subject to the reporting and announcement requirements under Chapter 14 of the Listing Rules.

COOPERATION AGREEMENTS IN RELATION TO PROPOSED ESTABLISHMENT OF THE FUND

On 31 May 2019, Jiangsu Zhongneng entered into the Cooperation Agreements with Leshan, Zeye Investment, Zeye Holding and Zhongping Guohao in relation to the establishment of the Fund.

PRINCIPAL TERMS OF THE COOPERATION AGREEMENTS

The principal terms of the Cooperation Agreements are as follows:

Date	31 May 2019
Parties	(1)	Jiangsu Zhongneng
	(2)	Leshan
	(3)	Zeye Investment
	(4)	Zeye Holding
	(5)	Zhongping Guohao

- 2 -

To the best of the Directors' knowledge, information and belief and having made all reasonable enquiries, Leshan, Zeye Investment, Zeye Holding and Zhongping Guohao and their ultimate beneficial owners are third parties independent of the Group and its connected persons.

Name of the Fund Leshan Polysilicon Photovoltaic Information Industry Investment Fund* (樂山多晶硅光電信息產業基金) (tentative name)

Purpose of the Fund The Fund will primarily invest in the polysilicon materials industry in Leshan City of Sichuan Province, PRC and companies with mature growth prospects in the photovoltaic industry.

At least 55% of the Fund's investments will be in companies that are registered for tax purposes within Leshan City. The remaining 45% of the Fund's investments may be in companies outside of Leshan City, but such companies should have capital and supply- chain ties with companies that the Fund has invested in within Leshan City.

Terms of operation of The term of the Fund will commence from the issuance of its

the Fundbusiness license and shall continue for seven (7) years, of which five (5) years will be the investment term and two (2) years will be the exit term.

Committed capital The total capital commitment to the Fund under the Cooperation

contribution Agreements is intended to be RMB4 billion to RMB4.5 billion. Capital contribution will be made by the limited partners as follows:

Partner	Capital contribution
	(RMB millions)
Leshan (as limited partner)	1,500
Jiangsu Zhongneng (as limited partner)	500
Zeye Investment (as limited partner)	500 to 1,000
Nominee of Zhongping Guohao (as
limited partner)	1,500

- 3 -

After an investment has been approved by the Fund's investment decision making committee, the fund manager will provide 5 days' notice to the limited partners of the Fund for the payment of their capital contributions.

The capital contribution of nominee of Zhongping Guohao will be paid as to (a) RMB1 billion by Jiangsu Zhongneng and

1. RMB500 million by Zhongping Guohao or another entity nominated by Zhongping Guohao.

The size of the Fund and the capital contribution of each partner were determined after arm's length negotiations between Jiangsu Zhongneng and the other parties having taken into account, among other things, the expected capital requirements of the Fund. It is anticipated that the total capital commitments payable by Jiangsu Zhongneng will be funded by internal resources of the Group.

Management of Zhongping Guohao will be the fund manager of the Fund.

the FundZhongping Guohao (or its wholly-owned subsidiary) will be the Fund's general partner and executive partner, and contribute RMB1 million to the Fund.

Zeye Holding will also be a general partner to the Fund and will assist in the duties undertaken by the fund manager. Zeye Holding will contribute RMB1 million to the Fund.

During the term of the Fund, the Fund will pay:

1. a management fee to the fund manager of 0.75% of the total amount of paid in capital contribution of the Fund each year; and
2. an execution fee of 0.75% of the total amount of paid in capital contribution of the Fund each year, of which half will be paid to Zhongping Guohao and the other half will be paid to Zeye Holding.

- 4 -

Investment decision The Fund will have an investment decision making committee making committee comprising of seven (7) members. Of these members, (a) Jiangsu Zhongneng and Leshan will each be entitled to appoint two (2) members, (b) Zeye Investment will be entitled to appoint one (1) member, (c) Zhongping Guohao will be entitled to appoint one

1. member and (d) Zhongping Guohao's nominee will be entitled to appoint one (1) member. Separately, Leshan will have the right to appoint one (1) observer to the investment decision making committee who will be allowed to observe meetings, but will not have the right to vote in respect of investment decisions.

The investment decision making committee will be responsible for reviewing and making decisions on investment projects proposed by the fund manager. Any investment and exit decision for projects related to GCL or projects within Leshan City will be approved by at least two-thirds of the investment decision making committee members. Any investment and exit decisions for an projects outside of Leshan City will be approved by at least four-fifths of the investment decision making committee members.

Profit sharing of the Income received after the exit of an investment project of the

FundFund (including but not limited to the distribution obtained from investment projects, project realisation or exit, rewards from government authorities, tax rebates) should be distributed to the partners in the following order (after deducting the costs of the investment projects):

1. first round of distribution: the distributable income will be distributed to the limited partners pro-rata to their respective capital contribution in the Fund, up to the total amount of capital contribution made by the relevant limited partners in the Fund;
2. second round of distribution: any remaining portion of the distributable income after the distribution in (i) above will be distributed to the limited partners such that each limited partner receives an amount which gives such limited partner a return of up to 8% per annum on their capital contribution to the Fund;

- 5 -